Killer App: Retailers find email outperforms social media advertising 3 to 1

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Excuse me, the 1990s called and they want their headline back.

It’s always been interesting to me how quickly we declare the old ways “dead” (I’ve done it too) when they continue to work quite well, thank you very much.

So it goes for email marketing, which many social media proponents have written off. It’s certainly true that social and mobile usage has been growing faster the past few years. That’s what new channels do. But does that mean they are more effective?

Not for retailers, according to an article in the San Francisco Chronicle. Based on sales per dollar spent, the DMA found that email outperformed social media advertising 3 to 1. That’s right, for every dollar in email advertising spent, retailers got $39.40 is sales. A dollar spent on social media yielded just $12.90. Web searches ($22.38) and boring old display ads ($19.71) also outperformed social media.

This is not particularly good news for Facebook, which is still trying to prove it can monetize 1B+ users. Walmart’s massive Black Friday ad buy certainly helped, but it remains to be seen how social media users will respond as ad bombardment increases. Despite Walmart’s 2 billion holiday ad blitz, Facebook stock is still down nearly 30% from its IPO price.

One of the reasons for email marketing success has been better targeted and tailored emails — a welcome relief from “spray and pray” campaigns of the past. We can probably thank Amazon.com for pushing this trend. Nearly every Amazon email I get promotes something I might be interested in buying.

I also think improved spam filters have made a huge difference. I’ve found Gmail does an outstanding job of removing spam, with few false positives.

Mobile devices have been a boon to social media, but have also helped email usage. Personally, I think the future will be a consolidated, cloud-based in-box that integrates email, social and other channels. I don’t like having to check 5 different places for messages.

While we wait for that happy day to arrive, email just quietly goes along and makes money. No hype required.

2 COMMENTS

  1. Bob –

    Thanks so much for sharing this important dose of post-Christmas reality. These days, and unlike past commoditized ‘push’ electronic communication promos, sophisticated database software enables email campaigns that can be highly targeted and personalized. That capability creates more brand trust, and even bonding behavior, on the part of prospects and customers. The DMA findings mirror those of consulting organizations like KellerFay.

    And, I completely agree with your perspectives, especially with respect to how effective promotions can become by using blended new social and traditional electronic/print communication approaches: http://www.customerthink.com/blog/advertising_vs_social_word_of_mouth_and_advocacy_behavior_part_1_the_trends

  2. Hi Bob, We at Unified Inbox are building exactly that cloud app you’re writing about. As the name suggests we unify external channels such as email and social media, we then add smart team collaboration features making it the perfect enterprise tool.

    Regards, Joakim Nilsson
    Head of Product Marketing
    @UnifiedInbox

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